Overview of Journal and Adjusting Entries in Accounting - The session involves discussing journal entries and adjusting entries related to purchases, sales, freight, and costs associated with inventory management. Homework problem number six will be covered, which includes various transactions related to journal entries. #### Key Concepts in Inventory Sales - Companies that sell merchandise typically deal with:- Inventory sales: Buying and reselling products for profit. - Sales recording: Involves recording revenue based on cash received or accounts receivable when sales are made on credit. - KIS Principle: "Keep it Simple," emphasizing straightforward approaches to financial transactions. #### Recording Sales Transactions - When a product is sold:- Asset recording: Cash received or a receivable (money owed by the customer). - Revenue recognition: Credit sales revenue upon completion of the transaction. - Inventory depletion: Decrease in inventory (asset account) and an increase in the Cost of Goods Sold (expense account). This happens simultaneously with the revenue recognition.